Investors in MainStreet Bancshares, Inc. (NASDAQ:MNSB) had a good week, as its shares rose 2.2% to close at US$21.99 following the release of its full-year results. Revenues came in 4.2% below expectations, at US$78m. Statutory earnings per share were relatively better off, with a per-share profit of US$3.25 being roughly in line with analyst estimates. The analyst typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. With this in mind, we've gathered the latest statutory forecasts to see what the analyst is expecting for next year.
View our latest analysis for MainStreet Bancshares
Following last week's earnings report, MainStreet Bancshares' solitary analyst are forecasting 2024 revenues to be US$76.6m, approximately in line with the last 12 months. Statutory earnings per share are expected to crater 40% to US$2.00 in the same period. Yet prior to the latest earnings, the analyst had been anticipated revenues of US$82.7m and earnings per share (EPS) of US$2.32 in 2024. From this we can that sentiment has definitely become more bearish after the latest results, leading to lower revenue forecasts and a real cut to earnings per share estimates.
Despite the cuts to forecast earnings, there was no real change to the US$26.75 price target, showing that the analyst doesn't think the changes have a meaningful impact on its intrinsic value.
Looking at the bigger picture now, one of the ways we can make sense of these forecasts is to see how they measure up against both past performance and industry growth estimates. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 1.7% by the end of 2024. This indicates a significant reduction from annual growth of 18% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the same industry are forecast to see their revenue grow 5.5% annually for the foreseeable future. So although its revenues are forecast to shrink, this cloud does not come with a silver lining - MainStreet Bancshares is expected to lag the wider industry.
The Bottom Line
The most important thing to take away is that the analyst downgraded their earnings per share estimates, showing that there has been a clear decline in sentiment following these results. Unfortunately, they also downgraded their revenue estimates, and our data indicates underperformance compared to the wider industry. Even so, earnings per share are more important to the intrinsic value of the business. There was no real change to the consensus price target, suggesting that the intrinsic value of the business has not undergone any major changes with the latest estimates.
Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. At least one analyst has provided forecasts out to 2025, which can be seen for free on our platform here.
And what about risks? Every company has them, and we've spotted 2 warning signs for MainStreet Bancshares (of which 1 is potentially serious!) you should know about.
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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.